Slower growth in labor demand in combination with increases in labor supply explains ________ accompanied by ________.
A)a slowdown in real wage growth; a decline in employment
B)a slowdown in real wage growth; rapid employment growth
C)a slowdown in real wage growth; increasing wage inequality
D)accelerated real wage growth; a decline in employment

Question

Quizplus · Accepted Answer

When both labor supply and labor demand rise at the same time, it is certain that quantity will increase but uncertain whether wages will rise or fall. If the demand shift was smaller than the supply shift there is downward pressure on real wages but an increase in employment.

Slower Growth in Labor Demand in Combination with Increases in Labor